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Is Solyndra a good example of why government intervention to spur solar deployment has unintentional downsides that cost far more than the benefit provided? I

Is Solyndra a good example of why government intervention to spur solar deployment has unintentional downsides that cost far more than the benefit provided? I think that as the cost of solar and wind come down, then markets will purchase more of it. Heavy handed government mandate just doesn't work due to inefficiency and bureaucratic mismanagement.

tedsanders 8y ago
I'm curious about that too. I think Solyndra by itself is not strong evidence of anything. Any big loan program will have big failures. The real question of efficacy is not "were there zero losers" but "were there enough winners in the portfolio to make up for the losers". Furthermore, I think the case could be made that governments are partly responsible for solar's historic price decline. The manufacturers needed economies of scale and learning, and demand subsidized go by governments (Germany, USA, China, Spain, etc.) really helped accelerate those private sector advancements. I'm not really sure how to evaluate this narrative, but I wouldn't be surprised if there were some academic economists who have looked at it.
jyounker 8y ago
Arguably Solyndra failed because the Chinese government pumped far more money into their solar industry then the US did, managing to produce developments that dramatically reduced traditional solar production costs.
elicash 8y ago
What was the downside? It was part of a loan program that made money -- and while Solyndra didn't survive, it's because solar prices plummeted in a way that's good for consumers and good for the environment.
- assblaster 8y ago
  It's more an example of the government picking a winner, and the winner actually losing in the market. What if it wasn't a loan guarantee but rather a direct investment or payment by the federal government?
  - elicash 8y ago
    > government picking a winner Bumper sticker slogans aside, seems to me like the program was quite successful and had no real downsides.
hn_throwaway_99 8y ago
> Heavy handed government mandate just doesn't work due to inefficiency and bureaucratic mismanagement. And the free market has shown that it is not capable of dealing with certain types of externalities. Consider the following example: suppose that it were guaranteed to be true that burning fossil fuels now at our current rate would cause a 5 degree C rise in temperature in 200 years. Now, of course I understand this may not be the actual case, and there is some actual amount of uncertainty, but my point is that even if it were guaranteed to be true, would free market forces cause a change in behavior? I certainly don't see how they would: there is money to be made now, while global devastation is someone else's problem. I wish folks would get away from the "government vs free market" tribalism and come to the more rational conclusion that there are some things the free market is excellent at, but dealing with far off consequences in the face of short term gain is definitely not one of them.
- burfog 8y ago
  Free market forces cause a change in behavior, though not the one you think is ideal. We would most likely install more air conditioning. Property values would change, with both winners and losers. Canada would benefit greatly. No, we wouldn't stop the temperature rise, but that wouldn't be the end of the world. Alternatives are not viable because even the most brutally abusive whole-world government wouldn't be able to stop cheaters, and anyway in that case the cure is worse than the disease.
  - hn_throwaway_99 8y ago
    Severe climate change of that which is estimated if we don't change course would cause the deaths of hundreds of millions if not billions of people. Talking about installing more AC and changing property values seems to be missing the point.
    - burfog 8y ago
      If we do change course, that would cause the deaths of hundreds of millions if not billions of people. This is what it would take to change course. You'd have to send the dissenters off to prison camps, which would realistically become death camps. The required level of control was tried in the 20th century, for just a moderate portion of the world, and that is exactly what happened. You simply can't make the entire world change course, not without killings done on a scale never seen before.
r00fus 8y ago
Solyndra was one exceptional case - the statistics showed (when Solyndra infamously imploded) that the vast majority (95%+) of governmentally supported green projects were successfully repaid and didn’t turn out poorly. Besides we already give billions in subsidies to big oil. If you honestly want a level playing field we need to stop giveaways to polluters first.

tedsanders 8y ago

I'm curious about that too. I think Solyndra by itself is not strong evidence of anything. Any big loan program will have big failures. The real question of efficacy is not "were there zero losers" but "were there enough winners in the portfolio to make up for the losers". Furthermore, I think the case could be made that governments are partly responsible for solar's historic price decline. The manufacturers needed economies of scale and learning, and demand subsidized go by governments (Germany, USA, China, Spain, etc.) really helped accelerate those private sector advancements. I'm not really sure how to evaluate this narrative, but I wouldn't be surprised if there were some academic economists who have looked at it.

jyounker 8y ago

Arguably Solyndra failed because the Chinese government pumped far more money into their solar industry then the US did, managing to produce developments that dramatically reduced traditional solar production costs.

elicash 8y ago

What was the downside? It was part of a loan program that made money -- and while Solyndra didn't survive, it's because solar prices plummeted in a way that's good for consumers and good for the environment.

assblaster 8y ago
It's more an example of the government picking a winner, and the winner actually losing in the market. What if it wasn't a loan guarantee but rather a direct investment or payment by the federal government?
- elicash 8y ago
  > government picking a winner Bumper sticker slogans aside, seems to me like the program was quite successful and had no real downsides.

hn_throwaway_99 8y ago

> Heavy handed government mandate just doesn't work due to inefficiency and bureaucratic mismanagement. And the free market has shown that it is not capable of dealing with certain types of externalities. Consider the following example: suppose that it were guaranteed to be true that burning fossil fuels now at our current rate would cause a 5 degree C rise in temperature in 200 years. Now, of course I understand this may not be the actual case, and there is some actual amount of uncertainty, but my point is that even if it were guaranteed to be true, would free market forces cause a change in behavior? I certainly don't see how they would: there is money to be made now, while global devastation is someone else's problem. I wish folks would get away from the "government vs free market" tribalism and come to the more rational conclusion that there are some things the free market is excellent at, but dealing with far off consequences in the face of short term gain is definitely not one of them.

burfog 8y ago
Free market forces cause a change in behavior, though not the one you think is ideal. We would most likely install more air conditioning. Property values would change, with both winners and losers. Canada would benefit greatly. No, we wouldn't stop the temperature rise, but that wouldn't be the end of the world. Alternatives are not viable because even the most brutally abusive whole-world government wouldn't be able to stop cheaters, and anyway in that case the cure is worse than the disease.
- hn_throwaway_99 8y ago
  Severe climate change of that which is estimated if we don't change course would cause the deaths of hundreds of millions if not billions of people. Talking about installing more AC and changing property values seems to be missing the point.
  - burfog 8y ago
    If we do change course, that would cause the deaths of hundreds of millions if not billions of people. This is what it would take to change course. You'd have to send the dissenters off to prison camps, which would realistically become death camps. The required level of control was tried in the 20th century, for just a moderate portion of the world, and that is exactly what happened. You simply can't make the entire world change course, not without killings done on a scale never seen before.

r00fus 8y ago

Solyndra was one exceptional case - the statistics showed (when Solyndra infamously imploded) that the vast majority (95%+) of governmentally supported green projects were successfully repaid and didn’t turn out poorly. Besides we already give billions in subsidies to big oil. If you honestly want a level playing field we need to stop giveaways to polluters first.